Last holdout, S.C., accepts stimulus aid

Governor seeks deal to pay debt

WASHINGTON - South Carolina Governor Mark Sanford backed down yesterday from his standoff with the White House over stimulus funding, becoming the last governor in the nation to announce officially that his state will accept economic recovery aid.

Sanford complied with yesterday's deadline for governors to seek the money allocated by Congress and President Obama in the $787 billion stimulus bill. Sanford, viewed as a potential presidential contender, has been the most outspoken of a handful of GOP governors who have criticized Obama's plan. He repeatedly said he would reject stimulus money because he did not think the nation should go into debt to fund recovery efforts.

Despite his reversal, Sanford said he will not draw from a $700 million portion of the stimulus for education and law enforcement unless he reaches a deal with South Carolina's Republican-controlled legislature to help pay off some of the state government's debt.

Sanford told reporters yesterday that the stimulus represents "the lottery of all lotteries" and that state governments should spend some of the money "prudently" by paying down debt.

"We think it is incredibly important to pay first for the political promises that are on the table before you go out and make a bunch of additional political promises," he said.

All 50 governors submitted certification letters to the White House claiming recovery funding. But some GOP governors - including Haley Barbour of Mississippi, Bobby Jindal of Louisiana, Sarah Palin of Alaska, and Rick Perry of Texas - have said they would turn away some of the money, such as funding to expand state jobless insurance.

South Carolina has an 11 percent unemployment rate, the nation's highest outside of Michigan, and will receive about $8 billion in aid, with about $2.8 billion going directly to the state government.

Sanford's move comes after weeks of battling with leaders in Washington and the state capital, Columbia.